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Their words
Well, logically, then lower interest rates without a fiscal loosening (that part is important) ought to lower inflation.
John Cochrane
Economist at the Hoover Institution; wrote The Fiscal Theory of the Price Level and blogs as The Grumpy Economist.
John Cochrane did not write this page. ppll compiled it from their own words, each linked to the source. Is this you? · Report a mistake
Latest Blog
What they believe
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Lowering interest rates without a fiscal loosening ought to lower inflation.
Well, logically, then lower interest rates without a fiscal loosening (that part is important) ought to lower inflation.
grumpy-economist.comSaid 3 Nov 2026This on korrents
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Changed their mind Core inflation helps forecast overall inflation, because food and energy prices vary only temporarily
Now This is way worse than I thought. I thought Core would help a bit. I believed that food and energy would have temporary variation which core would tell us to ignore.
Said 6 Aug 2023This on korrents
The bold line is korrents’ wording; the quote is theirs. These one: what they wrote before what they said aloud, one per source, newest first.
Feed
As its own page →Hiding
3 November
30 October
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Their words
In that context, though, personalized pricing by AI and big data could be a lot more efficient than all the games we go through now, since it’s basically costless.
Price discrimination by needless complexitygrumpy-economist.com
26 October
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korrents.com
A system with essentially no economic regulation and competitive markets would work for health care.Their words
A system with essentially no economic regulation, and brutally competitive markets, will work fine, and that includes pre-existing conditions and information asymmetry.
Some simple principles for taxation and spendinggrumpy-economist.com
25 October
From one piece Saving the Welfare State 2 beliefs · grumpy-economist.com
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korrents.com
The welfare state is at least part of the plummeting fertility that undermines the welfare state.Their words
The welfare state is at least part of the plummeting fertility that undermines the welfare state.
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korrents.com
Marginal tax rates well above 50% create undeniable disincentives to work, save, innovate, and invest.Their words
Marginal tax rates well above a half are deep in the range of undeniable disincentives to work, save, innovate, start and grow businesses, invest in education, and so on.
19 October
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korrents.com
Higher interest rates cannot durably lower inflation without a fiscal tightening to pay interest costs on the debt.Their words
In “expectations and the neutrality of interest rates” I show that even in an old-Keynesian adaptive expectations model, that otherwise well captures standard doctrines, higher interest rates cannot durably lower inflation without a fiscal tightening to pay interest costs on the debt.
14 October
From one piece Affordability Trilogy, Part 3. Why is the free market so unpopular? 2 beliefs · grumpy-economist.com
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Their words
Revitalizing the institutions of limited government may be more promising.
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Their words
Adam Smith’s vision, how greedy self-interest serves the public good is unnatural.
13 October
From one piece Affordability Trilogy, Part 2 2 beliefs · grumpy-economist.com
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Their words
Moreover, supply- and technologically-induced deflation, goods getting cheaper as wages stay the same, is fine. We’ve seen that in electronics, and AI may bring it more widely.
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Their words
I don’t think long recessions would be necessary. That’s pure Phillips curve thinking, that the only way to lower inflation is via high unemployment.
12 October
From one piece A Great Nobel 2 beliefs · grumpy-economist.com
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korrents.com
Policy consists of rules, either explicit or inferred from repeated behavior, not actions.Their words
Policy consists of rules, either explicit or inferred from repeated behavior, not actions.
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Their words
Hall’s approach is also the cornerstone of all subsequent macroeconomics.
11 October
From one piece Affordability Part 1 2 beliefs · grumpy-economist.com
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Their words
Subsidies against fixed supply, like energy and housing, just drive prices up more.
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korrents.com
The government cannot make anything more affordable overall through taxing, spending, borrowing, or regulating.Their words
As I hope you know, the government cannot, by taxing, spending, borrowing or regulating, make anything “more affordable” overall.
1 October
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Their words
Central banks should hold inflation-protected bonds as the primary assets on their balance sheets.
23 September
19 September
18 September
17 September
4 September
Nothing matches.
Beliefs
Korrents What they believe 37 beliefs, 1 changed mind — each backed by an exact quote.
Each is a — compiled by korrents.com, not by them: the one-line wordings are korrents', the quotes are theirs.
Recent
Lowering interest rates without a fiscal loosening ought to lower inflation.
Well, logically, then lower interest rates without a fiscal loosening (that part is important) ought to lower inflation.
Fisher and Resende in Brazil Said 3 Nov 2026
Personalized pricing by AI and big data could be more efficient than current signaling games because it is basically costless.
In that context, though, personalized pricing by AI and big data could be a lot more efficient than all the games we go through now, since it’s basically costless.
Price discrimination by needless complexity Said 30 Oct 2026
A system with essentially no economic regulation and competitive markets would work for health care.
A system with essentially no economic regulation, and brutally competitive markets, will work fine, and that includes pre-existing conditions and information asymmetry.
Some simple principles for taxation and spending Said 26 Oct 2026
Show 34 more
Marginal tax rates well above 50% create undeniable disincentives to work, save, innovate, and invest.
Marginal tax rates well above a half are deep in the range of undeniable disincentives to work, save, innovate, start and grow businesses, invest in education, and so on.
Saving the Welfare State Said 25 Oct 2026
The welfare state is at least part of the plummeting fertility that undermines the welfare state.
The welfare state is at least part of the plummeting fertility that undermines the welfare state.
Saving the Welfare State Said 25 Oct 2026
Higher interest rates cannot durably lower inflation without a fiscal tightening to pay interest costs on the debt.
In “expectations and the neutrality of interest rates” I show that even in an old-Keynesian adaptive expectations model, that otherwise well captures standard doctrines, higher interest rates cannot durably lower inflation without a fiscal tightening to pay interest costs on the debt.
Two New Papers Said 19 Oct 2026
Adam Smith’s vision of how greedy self-interest serves the public good is unnatural.
Adam Smith’s vision, how greedy self-interest serves the public good is unnatural.
Affordability Trilogy, Part 3. Why is the free market so unpopular? Said 14 Oct 2026
Revitalizing the institutions of limited government may be more promising.
Revitalizing the institutions of limited government may be more promising.
Affordability Trilogy, Part 3. Why is the free market so unpopular? Said 14 Oct 2026
Lowering inflation does not necessarily require long recessions or high unemployment.
I don’t think long recessions would be necessary. That’s pure Phillips curve thinking, that the only way to lower inflation is via high unemployment.
Affordability Trilogy, Part 2 Said 13 Oct 2026
AI may bring about widespread supply- and technologically-induced deflation.
Moreover, supply- and technologically-induced deflation, goods getting cheaper as wages stay the same, is fine. We’ve seen that in electronics, and AI may bring it more widely.
Affordability Trilogy, Part 2 Said 13 Oct 2026
Hall’s approach is the cornerstone of all subsequent macroeconomics.
Hall’s approach is also the cornerstone of all subsequent macroeconomics.
A Great Nobel Said 12 Oct 2026
Policy consists of rules, either explicit or inferred from repeated behavior, not actions.
Policy consists of rules, either explicit or inferred from repeated behavior, not actions.
A Great Nobel Said 12 Oct 2026
The government cannot make anything more affordable overall through taxing, spending, borrowing, or regulating.
As I hope you know, the government cannot, by taxing, spending, borrowing or regulating, make anything “more affordable” overall.
Affordability Part 1 Said 11 Oct 2026
Subsidies against fixed supply, such as energy and housing, drive prices up.
Subsidies against fixed supply, like energy and housing, just drive prices up more.
Affordability Part 1 Said 11 Oct 2026
Central banks should hold inflation-protected bonds as primary assets
Central banks should hold inflation-protected bonds as the primary assets on their balance sheets.
An Inflation-Protected Balance Sheet Said 1 Oct 2026
Holding real assets should help central banks control inflation.
At a basic level, holding real assets should help central banks to control inflation.
An Inflation-Protected Balance Sheet Said 1 Oct 2026
Under the general fiscal theory of the price level, sticky prices are accommodated through variation in the real interest rate.
The general FTPL with debt on the left and surpluses on the right adapts to sticky prices by real interest rate variation.
An Inflation-Protected Balance Sheet Said 1 Oct 2026
Banks oppose interest-paying stablecoins to avoid competition on checking account interest rates.
Banks don’t want competition, which would force them to pay interest on checking deposits. Plain and simple.
Political economy in financial regulation Said 23 Sept 2026
The tradeoff between government borrowing cost and interest-rate risk should rest with the politically accountable Treasury, not the independent Fed.
The tradeoff between cost of borrowing and how much interest rate risk taxpayers shoulder should be squarely on the shoulders of the politically-accountable Treasury not the independent Fed.
Better Debt Said 19 Sept 2026
When the Fed buys long-term Treasuries under QE, issues overnight debt, and passes the interest difference back to the Treasury, it is as if the Treasury issued overnight debt.
In QE, the Treasury issued long-term bonds. The Fed bought up the long bonds, issued overnight debt, and passed the interest difference back to the Treasury. In the end, it is just as if the Treasury issued overnight debt in the first place.
Better Debt Said 19 Sept 2026
The bulk of government debt should gradually consist of fixed-coupon perpetuities and fixed-value floating-rate perpetuities.
Simplifying a bit, the Treasury should introduce a fixed-coupon perpetuity and a fixed-value floating-rate perpetuity. These should gradually make up the bulk of government debt.
Better Debt Said 19 Sept 2026
Businesses raise prices only when their accounts force them to, not when they can see the cost coming.
Business only raise prices when accounting losses force them to do so.
A note on tariffs from the real world Said 25 Oct 2025
Customers leave faster when prices rise than they come back when prices fall, which is why sellers hold prices as long as they can.
I suspect higher prices make people leave more quickly than lower prices make them come.
A note on tariffs from the real world Said 25 Oct 2025
Climate change is real and is not the civilisation-threatening disaster it was sold as, and the expensive policies bought nothing.
climate change though real is not the civilization-threatening disaster pitched at Davos, Paris, and the media, that hugely expensive climate policies do no good
Climate turning point Said 18 Sept 2025
Climate became a moral and political cause rather than a technical one, and that is what will destroy public support for it.
The “climate crisis” has been taught as gospel for 20 years. Now the average person can see their teachers have been preaching politics in the name of science.
Climate turning point Said 18 Sept 2025
Trust in institutions has fallen because the institutions have been repeatedly and spectacularly wrong.
Well, when the institutions are over and over spectacularly wrong, whether just incompetent, politicized, or mendacious, there is a reason for loss of trust.
Climate turning point Said 18 Sept 2025
High electricity prices are what is killing European industrial competitiveness.
The average European and UK voter, once he or she moves on from immigration, will notice how Europe and the UK have made energy unaffordable, stopped its growth-exactly as degrowthers wish-and deindustrialized, on the altar of climate policies that do nothing to improve the climate.
Climate turning point Said 18 Sept 2025
The right answer on trade is unilateral free trade, and the hard part is only explaining why the objections fail.
Tariffs are easy: The right answer is unilateral free trade.
Tariffs, saving, and investment Said 14 Apr 2025
The American trade deficit is foreigners choosing to invest in America, not America being cheated.
this story tells us how an increase in foreign demand to save in the US rather than at home will push up the dollar, and cause the trade deficit, which is in effect how foreigners send us factories which they would rather build here than in their own countries.
Tariffs, saving, and investment Said 14 Apr 2025
America borrowed cheaply from the world and spent it on consumption rather than investment, exactly as Greece did.
In sum, spurred on by the federal government (in many ways), the US borrowed a huge amount from foreigners at very low rates, and went on a consumption binge. Sooner or later we have to pay it back, or we go though the wrenching adjustment of a debt crisis.
Tariffs, saving, and investment Said 14 Apr 2025
Cutting off trade with tariffs would force a huge interest-rate spike and probably a debt crisis, because the budget deficit would have to be financed at home.
But the spike in interest rates require to do this would be huge. And the trade shock will cause a sharp recession, or worse, putting even more stress on the budget. A debt crisis is likely along the way as the US finds it impossible to roll over debt.
Tariffs, saving, and investment Said 14 Apr 2025
The binding constraint on building anything in America is permitting and litigation, not money.
Endless lawsuits, cost-exploding contracting requirements, decades to get permits, and more bedevil any attempt to invest here.
Tariffs, saving, and investment Said 14 Apr 2025
The cure for the trade deficit is to tax consumption instead of saving and investment, and to stop borrowing to fund consumption.
Cure the disease, not the symptoms. Reform taxes to tax consumption, not saving and investment. Stop funneling borrowed money to consumption.
Tariffs, saving, and investment Said 14 Apr 2025
Price gouging should be legal, because a sharply higher price is what sends scarce supply to the people who need it most.
Price gouging is wonderful for all the reasons that letting supply equals demand is wonderful. When there is a limited supply, then a sharply higher price directs that supply to those who really need it.
Praise for Price-Gouging Said 20 Aug 2024
Laws against price gouging are what cause hoarding, because it is the expectation of empty shelves that makes people stock up.
Hoarding goes with price controls, anticipated empty shelves.
Praise for Price-Gouging Said 20 Aug 2024
When a shock falls hardest on the poor, hand out cash rather than hold the price down.
But more deeply, if distributional consequences of a shock are important, then hand out cash. So long as everyone faces the same prices.
Praise for Price-Gouging Said 20 Aug 2024
Handing out cheques during Covid and accepting the inflation was less damaging than price controls and rationing would have been.
We got inflation, but we did not get the devastation that would have been caused by price controls and rationing.
Praise for Price-Gouging Said 20 Aug 2024
Beliefs others hold too
The binding constraint on building anything in America is permitting and litigation, not money. 3 hold this
Endless lawsuits, cost-exploding contracting requirements, decades to get permits, and more bedevil any attempt to invest here.
Tariffs, saving, and investment Said 14 Apr 2025
High electricity prices are what is killing European industrial competitiveness. 2 hold this
The average European and UK voter, once he or she moves on from immigration, will notice how Europe and the UK have made energy unaffordable, stopped its growth-exactly as degrowthers wish-and deindustrialized, on the altar of climate policies that do nothing to improve the climate.
Climate turning point Said 18 Sept 2025
What is a korrent?
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Recommends rcmnd
rcmnd What they recommend 5 things — each backed by an exact quote.
Compiled by rcmnd.app, not by them: the quotes are theirs, and each links to the post it was copied from.
Recent
Recommends The Celebration Honoring John Taylor
I don’t mean to slight the many other great contributions. You will learn a lot about macro and monetary economics from this lovely book.
grumpy-economist.com 19 May 2026
their own
What others say about The Celebration Honoring John Taylor →
Recommends The Conservative Sensibility
In your archives of classics, this book should go alongside Plato, Macchiavelli, Hume, and the Federalist Papers. (And George Will’s Conservative Sensibility. )
grumpy-economist.com 4 Feb 2026
Loved Parliament of Whores
Recently I found out that P.J. O’Rourke’s masterpiece of political philosophy, Parliament of Whores, is online , for free. In your archives of classics, this book should go alongside Plato, Macchiavelli, Hume, and the Federalist Papers.
grumpy-economist.com 4 Feb 2026
Show 2 more
Loved Knowledge and Decisions
Then I found the just-published Knowledge and Decisions , Tom Sowell’s economic masterpiece. (I read several other eye-opening Sowell books at the same time, especially his works on race, and culture. But it is not my task to share that experience today.) This was a world-view-changing experience
grumpy-economist.com 20 Oct 2025
Loved Late Admissions
Glenn Loury’s “Late Admissions” memoir is superb. Read it. Better, get the audiobook, read by Glenn, and listen to Glenn tell you about his life in his own voice, as I did for 1400 miles.
grumpy-economist.com 20 Jun 2024
Where they publish
Blog The Grumpy Economist His blog on monetary and fiscal policy. Has a feed.
Recent
- Fisher and Resende in Brazil 3 Nov 2026 This intriguing substack by André Lara Resende is causing an uproar in Brazil.
- Price discrimination by needless complexity 30 Oct 2026 (This is another script for a forthcoming weekly rant. Recycling disclaimer.)
- Some simple principles for taxation and spending 26 Oct 2026 This appeared in the Hoover Freedom Frequency, and Commons Dispatch, but for any of you who don’t read that, here it is, with a few tweaks.
Show 17 more
- Saving the Welfare State 25 Oct 2026 I was invited to the “Festival Internazionale dell’ Economia” in Turin, to speak about inflation and debt.
- Two New Papers 19 Oct 2026 It is still thrilling when a paper is finally published.
- Affordability Trilogy, Part 3. Why is the free market so unpopular? 14 Oct 2026 [This is a third post based on scripts for the “weekly rant.” ]
- Affordability Trilogy, Part 2 13 Oct 2026 [This is based on a second script for an upcoming “weekly rant.” Part 1 explored an interesting WSJ survey on how popular populist policies are.]
- A Great Nobel 12 Oct 2026 As you may have heard, Mike Woodford and Bob Hall won the 2026 Nobel prize.
- Affordability Part 1 11 Oct 2026 [This is based on a script for an upcoming “weekly rant”.
- An Inflation-Protected Balance Sheet 1 Oct 2026 A Substack lets me share fun new ideas.
- Political economy in financial regulation 23 Sept 2026 Interest-paying electronic money, completely safe without deposit insurance, would be a great thing.
- Better Debt 19 Sept 2026 The dog that didn’t bark is often meaningful.
- Media Update 18 Sept 2026 The link to Barron’s was wrong in my previous post. The correct link below:
- Media 17 Sept 2026 I’ve done a variety of video and other media lately that (some) readers may find interesting.
- More on lower rates 4 Sept 2026 This follows up my last post on lowering rates to lower inflation.
- Reasons to Lower Rates 4 Sept 2026 Is there a coherent story in which the Fed should lower interest rates now?
- French Fables 24 Aug 2026 An interesting brouhaha has broken out in France, lately famous for reinvigorating the idea of wealth taxes: The French government should default on (“annul” “cancel” — the left is great at euphemisms) its debt held by…
- Interest Rate Surge? 20 Aug 2026 US long term interest rates are surging.
- Wealth Tax 2.0 19 Aug 2026 Senator Bernie Sanders and Representative Ro Khanna just introduced a bill proposing a permanent national 5% wealth tax on billionaires, along with an ambitious spending program for the results.
- Three news items and a lesson 18 Aug 2026 Today, a few small recent economic news items add up to a bigger picture.
Link verified 20 Sept 2026. Recent items update automatically from the channel.
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